The 340B program, established by Congress in 1992, is integral for safety-net providers serving uninsured or vulnerable patients. It mandates drug manufacturers to offer discounts to certain federally-funded clinics and hospitals—known as “covered entities”—as part of their participation in Medicaid. This initiative allows these entities to stretch federal resources, reaching more patients and enhancing service offerings.

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Who Qualifies for the 340B Program?

Facility Eligibility

Covered entities qualify for the 340B program primarily in two ways:

  1. By receiving one of ten types of federal grants, which generally support clinics that provide primary and preventive care to at-risk populations.
  2. By being one of six types of non-profit hospitals that meet specific criteria geared towards serving a high proportion of uninsured or vulnerable patients.

Patient Eligibility

For a patient to receive drugs purchased through the 340B program, they must fit a defined patient profile:

  • They must have established records at the covered entity.
  • They receive healthcare from professionals either employed by or contracted with the entity.
  • The healthcare services they receive must be consistent and within the scope of care provided by the entity.

Navigating Challenges in the 340B Program

Compliance is crucial, given the 340B program’s complexity. The Health Resources and Services Administration (HRSA) conducts around 200 audits annually to ensure adherence to the requirements. Non-compliance could lead to exclusion from the program and potential financial repercussions, such as repayments to manufacturers for improperly purchased drugs.

The program has garnered significant attention, especially from pharmaceutical companies advocating for restrictions associated with contract pharmacy relationships. Such constraints could reduce the scope of communities and patients that benefit from the 340B program. The discounts are pivotal in sustaining healthcare safety nets and, by extension, the viability of hospitals and clinics serving marginalized populations.

How HealthTrust Supports 340B Participants

At HealthTrust, we are committed to assisting 340B participants through the program’s complexities and uncertainties. Our committed model approach acknowledges that purchasing strategies for covered entities need to be distinct from those of non-eligible facilities. We strive for contracting optimization by evaluating opportunities through the varied requirements of different entity types.


The 340B program plays a critical role in enabling healthcare providers to serve disadvantaged communities effectively. At HealthTrust, we are here to help you navigate this program, ensuring you can maximize its benefits and meet compliance standards. For more information or to inquire about our 340B consultative services, please feel free to reach out.

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